Albany City Considers Battery Storage to Reduce Losses
The city evaluates a new storage system to offset $2 million in annual losses from surplus power purchase agreements.
Updated on Oct. 15, 2026 in Utilities
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Albany is considering the installation of a battery energy storage system to manage excess electricity from its mandatory power purchase contract. The proposal aims to mitigate financial losses incurred by the city's utility provider by storing low-cost energy for use during periods of peak demand.
Why it matters
The utility faces a recurring $2 million annual loss because its contractual purchase obligations often exceed local energy consumption. By shifting to storage, the city hopes to capture higher market prices for excess power rather than selling it at a loss.
Albany Utilities reported a $2 million loss in 2025, driven by a mismatch between contractual purchase requirements and lower city energy demand. Proposed battery storage projects, ranging from $45 million to $90 million, aim to recoup between 18% and 53% of these losses through peak-load arbitrage.
The players
Albany Utilities
The municipally owned provider responsible for managing energy distribution and contractual power obligations in Albany.
Municipal Electrical Authority of Georgia
A wholesale power provider that maintains long-term electricity purchase contracts with regional municipal utilities.
Dougherty County Commission
The local governing body responsible for establishing land-use and safety ordinances for infrastructure projects in the region.
The details
The utility currently purchases power under a long-term agreement with the Municipal Electrical Authority of Georgia but often finds itself with excess supply. The proposed storage system would enable the city to charge batteries during low-demand windows and discharge that energy during peak usage when electricity market values are higher. This shift relies on federal funding covering 50% of construction costs to improve the project's overall return on investment.
Timeline
2025: Albany Utilities incurred an estimated $2 million financial loss.
October 2025: Dougherty County Commission approved regulations for battery storage systems.
October 1, 2026: Solar energy companies presented two project options to the City Commission.
Market Landscape
The city's infrastructure plan follows the regulatory framework established by the Dougherty County battery storage ordinance adopted in October 2025. This project represents a shift toward utilizing localized storage to offset long-term wholesale supply constraints.
Operators in the region should monitor the commission's upcoming independent feasibility report, as it will determine the scale of the energy project and potential impact on municipal utility rates. Businesses should verify how local storage regulations may affect their own onsite energy generation or backup capacity requirements.
The takeaway
Albany is attempting to turn a mandatory supply surplus into a revenue-generating asset through high-capacity storage. Local operators should track the upcoming economic feasibility report to understand if the project stabilizes future utility costs.
Further reading
For more on grid infrastructure, see our analysis of Utilities.
Source note: This article includes information reported by Albany Herald.
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